More rented homes 'unaffordable'

Private rents have become unaffordable in more than half of local authorities in England, research from Shelter found today.

The charity said average private rents are beyond the means of "ordinary" families in 55% of local authorities.

Homes were found in these areas which cost more than 35% of the median average local take-home pay - the level considered by the Shelter Private Rent Watch report to be unaffordable.

Campbell Robb, chief executive of the housing and homelessness charity, said: "We have become depressingly familiar with first-time buyers being priced out of the housing market, but the impact of unaffordable rents is more dramatic.

"With no cheaper alternative, ordinary people are forced to cut their spending on essentials like food and heating, or uproot and move away from jobs, schools and families."

Shelter said that in the 10 years up to 2007, rents increased at one-and-a-half times the rate of incomes.

Private rents in 8% of local authorities in England were "extremely unaffordable" - with average rents costing 50% or more of full-time take-home pay.

Just 12% of areas were affordable, with rents sitting below 30% of take-home wages.

The analysis was carried out on two-bedroom homes due to their common occurrence.

London boroughs were the most expensive, with the average monthly rent for a two-bedroom home in the capital standing at £1,360 - almost two-and-a-half times the average in the rest of England, at £568.

The highest private rent for a two-bedroom home was in Kensington and Chelsea, at £2,714 a month, while the lowest was in Burnley, Lancashire, at £394 a month.

Shelter said the least affordable local authority area outside London is Oxford, where typical rents account for 55% of average earnings.

Blackpool was highlighted as the most unaffordable area in the North of England, with average rents taking up 42% of full-time pay.

Rents in Blackpool fell within the cheapest third in England, but relatively low local earnings made them "unaffordable".

The charity said that 38% of families with children who are renting privately have cut food purchases to pay rent. Close to a third (30%) of privately-rented homes contain children.

Rural areas appear to be bearing the brunt of high rental prices relative to income.

Researchers found it is more affordable to rent in Manchester, Liverpool or Birmingham than in north Devon, north Dorset or Herefordshire.

Alice Barnard, chief executive of the Countryside Alliance, said: "If we want our rural communities to flourish, then the Government needs to urgently review the rental market in rural areas to enable rural communities to meet their housing needs."

Researchers used Valuation Office Agency and Office for National Statistics data.

Housing Minister Grant Shapps said: "This Government recognises the importance of the private rented sector in providing accessible and affordable accommodation.

"We have stopped the imposition of excessive new red tape on the private rented sector, which would have pushed up rents and reduced choice for tenants.

"We also need to build more homes given new house building fell to its lowest peacetime levels since the 1920s under the last administration.

"Our housing initiatives include freeing up disused public land to build more homes, rewarding councils for helping build more homes through a New Homes Bonus.

"It's also why the Budget included new stamp duty measures for bulk property purchases to make large-scale private investment in the rental market much more attractive."

PA